The Intermediary – December 2025 - Flipbook - Page 36
SPECIALIST FINANCE
Opinion
A year of cautious
markets and
active investors
2
025 hasn’t been a
headline-grabbing year
for the housing market.
House prices have barely
moved, transaction
volumes remain
subdued, and mainstream activity
has been defined by caution rather
than confidence.
According to HMRC, the number of
UK residential property transactions
in September was down 18% on
the same month last year. Home
buyers and sellers have continued to
hold back.
However, from our experience,
many property investors haven’t
stepped back – they’ve simply changed
tack. Faced with tighter yields and
fewer obvious opportunities, many
have diversified into alternative asset
types – houses in multiple occupation
(HMOs), multi-unit freehold
blocks (MUFBs), holiday lets, semicommercial properties. Others have
focused on value creation through
refurbishment or repurposing.
A recent ‘Rental Market Report’ by
Zoopla said that annual rent growth
has slowed to just over 5% – the lowest
level in more than three years. While
demand remains strong, affordability
pressures are rising and tenants are
becoming more selective. That’s led
many landlords to upgrade stock to
aract and retain quality tenants.
So, it’s perhaps unsurprising that
while the wider mortgage market
has been relatively subdued, bridging
lending has continued its path
of momentum. According to the
Bridging & Development Lenders
Association (BDLA), bridging lender
loan books passed through £13bn
for the first time in the second
quarter of 2025.
There have been two drivers behind
this sustained growth in the bridging
34
The Intermediary | December 2025
market. The sector is certainly
growing in reputation, with more
brokers engaging with the market,
more confident in identifying where
bridging fits, and more proactive in
structuring the right solution for their
clients. Initiatives like the Certified
Practitioner in Specialist Property
Finance (CPSP) qualification have
certainly helped this.
At the same time, the lender
environment has become ever more
competitive, driving innovation in
product and service as lenders have
worked harder to stand out. This has
driven higher standards and more
customer-focused propositions, which
have appealed to the growing number
of bridging brokers.
We’ve certainly felt that competitive
pressure at Castle Trust Bank – and
we’ve welcomed it, as it’s pushed the
market forward. Not least our own
proposition.
Growing together
Over the last year, we’ve invested
heavily in our people and
infrastructure. That includes growing
our underwriting and completions
teams, launching a dedicated bridging
underwriting function, and investing
into innovations like the upgraded
PULSE broker portal. We also offer
drawdown functionality on both light
and heavy refurbishment bridging –
and we use tools like title insurance
and dual legal representation to
compress timelines.
The accumulation of all these
improvements, and a continued
focus on doing the simple things well,
means that 2025 has been our best year
yet – and we have more than doubled
completions across our lending. Even
more pleasing is that several of our
broker partners have now completed
over £25m with us in a single year
ANNA LEWIS
is commercial director
at Castle Trust Bank
There are still
opportunities to be had.
Whether it’s a conversion
project, simple refurb
or property overhaul,
investors are still active”
– not through one-off cases, but by
placing a steady stream of business.
Building consistent broker
partnerships like this shows that we’re
doing something right to stand out
in a crowded market. It also reflects
the level of demand for funding from
some investors, and the benefits for
those brokers able to build strong
collaborative relationships with
investor clients.
As we head into 2026, the market
outlook may remain cautious. The
much-heralded Budget brought lile
to be excited about, with an increased
tax burden for landlords and owners
of £2m-plus properties, but there are
still opportunities to be had.
Whether it’s a conversion project,
simple refurb or property overhaul,
investors are still active. And the
brokers who can structure these deals
confidently, and align with lenders
who understand the landscape, will be
the ones who continue to grow.
That’s where we’re focused –
delivering the tools, service and
support to help brokers meet
that demand and build stronger
relationships with their clients. ●
